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United States: California Amends Pay Equity Law

11/6/2018

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California has made changes to its pay equity law to clarify proper interview questions, the disclosure of pay scales and the application of the law to existing employees. The changes will take effect January 1, 2019.

The California Fair Pay Act indicates that “an employer shall not pay any of its employees at wage rates less than the rates paid to employees of the opposite sex,” or to employees of another race or ethnicity, for equal work on equal jobs. Amendments in 2017 and 2018 prohibited employers from relying on job applicants’ salary histories or asking about prior salary (with certain exceptions).

The amendments clarify the legislation by confirming that this applies to new and potential employees, not to internal applicants. It also expressly permits the employer to ask about salary expectations when considering offering a role. The legislation also clarifies that an employer may consider a current employee's existing salary when making a compensation decision.

The Australian Budget of May 8, 2012 included several provisions of note. In previous updates, we highlighted the changes to superannuation plans and the uncertain CIT rate (which will not, after all, be reduced from 30% to 29%).